The document summarizes the state of the Minnesota and U.S. economies following the Great Recession. It finds that while the recession officially ended in 2009, recovery has been slow with real GDP growth below 2% through 2011. Job losses were severe, with Minnesota losing 4.3% of jobs since the recession began. Looking forward, challenges include an aging population, slowing labor force growth, rising healthcare costs, and the need to adapt to lower levels of economic growth and consumption in the new normal. Productivity gains through education, innovation and improving outcomes rather than just cost cutting will be important to economic success. Public sector productivity will also be key.